With housing prices in Hong Kong significantly outpacing GDP growth since 2009, JPMorgan Chase & Co. believes prices in the city are nearing their peak and economically “unsustainable”, reported Bloomberg.

In fact, any external shock could lead to tighter liquidity within the city’s banking system and increased borrowing costs among home buyers, said Cusson Leung, Managing Director at JPMorgan Chase & Co.’s Asia Pacific equity research unit.

“I won’t buy…If the bubble bursts, buyers will not only lose their own money, they will also lose all of their parents’ money,” said Leung, who expects house prices to remain unchanged this year.

He revealed that home buyers have been using the existing homes of their parents as collateral to help pay for deposits.

Hong Kong’s resurgent residential market has seen existing house prices hit new records in recent weeks, following a short-lived dip.

This comes as investors found ways to skirt around the measures set up by the government to curb the rally in house prices. Qualifying as first-time buyers and purchasing multiple new homes under a single contract was among the options taken by wealthy buyers to avoid a measure that raised the stamp duty to 15 percent for existing property owners.

Leung said closing the loopholes would make the city’s property market “less crazy”. The government could also sell public flats under its rental housing programme to increase supply, he added.